CVS, Express Scripts fire Valeant's pharmacy partner
CVS Health (CVS) and Express Scripts (ESRX) on Thursday both said they are axing Philidor RX Services from their pharmacy networks after reviewing the practices of the mail-order supplier. Philidor has drawn scrutiny for its controversial partnership with Valeant Pharmaceuticals International (VRX).
"CVS/caremark maintains a broad national network of 68,000 pharmacies. In accordance with CVS/caremark's standard auditing protocols, over the last several weeks we have been monitoring and reviewing the results of recent audits of Philidor's practices. Based on the findings from those activities, we have terminated Philidor for noncompliance with the terms of its provider agreement." CVS said in an emailed statement.
"We are in the process of terminating the Philidor pharmacy from our network," Express Scripts emailed. "We routinely monitor our network and take action when we see pharmacies trying to circumvent solutions, like formulary management, that protect payers and patients from wasteful drug spend."
Valeant's market valuation has been hammered by fraud accusations leveled by short-seller Andrew Left. He accuses the drugmaker of using Philidor, a little-known specialty pharmacy, to inflate its revenue by relying on the mail-order supplier to store inventory while counting the transactions as sales.
Valeant shares, which fell nearly 5 percent during Thursday's session to close at $111.50, dived nearly 14 percent in after-hours trading.